Market Report

      In the last week, Indian Markets ended the expiry week sharply lower. Continuing concerns on monsoons and lack of policy reform announcements had a negative impact on sentiments. The comments from the ECB President did help.  On sectoral front BSE Realty, Capital goods and Power were badly hit. On the other hand, Global stock markets largely remained depressed during the week as debt ridden European countries yields rose on the risks that the countries like Spain would fail to abide by the conditions required for bailout assistance. However some buying emerged in the stock markets during the end of the week after the statements of European Central Bank President, Mario Draghi that the policy makers would do whatever is needed to preserve the Euro. Japanese policy makers are expected to come out with fiscal stimulus as the nation is struggling for growth in light of weak demand from overseas markets and fading stimulus from reconstruction activity after earthquake.The 30-share index, Sensex plunged 319.25 points, or 1.86% to 16,839.19 for the week ended July 27, 2012. On the other hand, the broad based NSE Nifty dropped 105.25 points, or 2.02%, to 5,099.85 during the week. All the sectoral indices at the BSE ended in red. Top losers for the week were BSE Realty (6.67%), Capital goods (6.45%), Power (5.09%), Metal (4.5%), PSU (4.36%), Bankex (3.4%), Auto (3.10%). Rest IT, Teck, FMCG and Healthcare were down from 1.81% to 0.18%. Meanwhile, BSE Midcap and Smallcap underperformed with losses 4.80% and 4.76% respectively. 

Markets are awaiting some announcements on reforms from the Government and markets will rise sustainable, only if these are announced and implemented.

We have decline from Monday to Thursday and in this time emerging market were having a handsome gain. Now that problem of Indian economy is rain or monsoon and RBI’s reaction in upcoming meet on Tuesday. Industries are expecting rate cuts in CRR and REPO RATE. If we see any rate cut in CRR       and repo rate we may see a rally up to 5500 in very near term. That is why in every good market of economy our market have not perform. So they are eagerly waiting for RBI to give some hint for the market.

Last week full of pain for the mid cap stock. Even some of my favorites stocks were also sell off heavily. The event which was responsible for that was SEBI’s decision to get them out of future option list.

Second bad news was selling in mid cap stock. Those stocks were basically sell off as the promoters of the company could not the loan which they have taken form the banks. So margins were hits and mortgages shares were sold due to that selling was seen. Those stocks are as below era infra. Tulip tele . pennisilia land. Parsvnath, gokul refinery., dchl. This will be a last chance for UPA government to show the public that they can change the scenario of the economy. While in the presence Mr. montek singh ahluwalia and Mr. pranab mukherji and our honorable Prime Minister Mr. manmohan singh. We hope that they will put our growth   rate in to good direction. Let’s hope that we may see a rally.

Trading strategy for nifty:

Investors are wisely advise don’t trade till Monday. Because RBI’s meeting is on Tuesday. So either waits for Tuesday of remain short for Monday in the market. Investors should take the position on Tuesday after 11 am. If any rate cut is seen in repo rate and CRR. Then create buy position and if no rate cut is seen then create shot position.

If rate cut declare by RBI				If no rate cut declare by RBI
Scrip	Strike price	Rate	Target	Scrip	Strike price	Rate	target
Nifty	5200 call	60`	160`	Nifty	5000 put	50`	175`
Nifty	5300 call	30`	100`	Nifty	4900 put	30`	100`
Nifty	5400 call sell	12`	1`	Nifty	4800 put sell	17`	1 `

Stop loss: - for buying position: no rate cut

                    For selling position: rate cut

Trading strategy: bank nifty

If rate cut declare by RBI				If no rate cut declare by RBI
Scrip	Strike price	Rate	Target	Scrip	Strike price	Rate	target
Bank Nifty	10400 call	180`	300`	Bank Nifty	10000 put	160`	360`
Bank Nifty	10500 call	140`	350`	Bank Nifty	9900 put	130`	385`
Bank Nifty	10600 call sell	110`	25`	Bank Nifty	9800 put sell	110`	10 `

Stop loss: - for buying position: no rate cut

           For selling position: rate cut

STOCK SPECIFIC STRAGEY:

Buy put of sbin of strike price 1800 at 27 to 28 `. target price 100 `. stop loss 1999 `

Sell call of sbin of strike price 2100 at 27 to 28 `, target price 1 ` . stop loss 1999 `

Stock specific strategy: Larson and toubro

Sell call of LNT of 1400 strike price at 13 to 14 ` for the price target of 1 ` and stop loss will be 1349

Buy put of LNT of 1200 strike price at 7 to 8 ` for the price target of 70 ` and stop loss will be 1349

         

Stop loss: - for buying position: no rate cut

                    For selling position: rate cut

Mid cap stock specific strategy : skumarsynf + HCC + LITL  [ SHORT ]

Short all these stock with strict stop loss

Scrip	Short price	Target
Skumar	26`	22`
Hcc	17`	14.5`
Litl	12.25`	9.50`

Stay away from mid cap stock. Any investors having mid cap stock and price of that stock are declining, don’t try to average it right now. Either let nifty to come at the level of 4800 to 4900. Then average. And stay away trading in mid cap stock.

Stop loss: - for buying position: no rate cut                                                                for selling position: rate cut